eBay sued for US$3.8bn over PayPal patents

14 Jul 2010

E-commerce giant eBay is being accused of infringing six patents that are used in its PayPal payment system.

A lawsuit was filed yesterday at a federal court in Delaware by XPRT Ventures LLC alleging that eBay stole information shared in confidence by the inventors of the patents in the dispute.

It is alleged that eBay incorporated this information into features of its PayPal payments system, such as PayPal Pay Later and Pay Pal Buyer Credit.

XPRT alleges that in April 2003, eBay filed a patent application entitled “Method and System to Automate Payment for a Commerce Transaction” but failed to tell the US Patent and Trademark office it was aware of XPRT’s own applications.

XPRT is seeking a minimum US$3.8bn in damages based on the estimated value of the patent.

eBay last month bought RedLaser, a bar code scanning technology provider, for an undisclosed sum in a move that would bring e-commerce from the web to the high street.

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years